The Danger of Too Loose, Too Long

With an improving labor market and an uptick in inflation, the danger now is to wait too long to tighten.

By

Richard W. Fisher

July 27, 2014 6:14 p.m. ET

I have grown increasingly concerned about the risks posed by current monetary policy.

First, we are experiencing financial excess that is of our own making. There is a lot of talk about "macroprudential supervision" as a way to prevent financial excess from creating financial instability. But macroprudential supervision is something of a Maginot Line: It can be circumvented. Relying upon it to prevent financial instability...